Tuesday, July 17, 2012

Market strategist Jeff Saut is out with his weekly commentary entitled "Cognitive Dissonance." He titled his piece as such due to certain economic readings softening while others strengthened. Saut also addresses how it can often pay to go against the crowd, likening the current market action to that of the past two years.

He argues that just like the past two years, the markets have peaked in May/June and will decline for a few months before surging higher into year-end as no evidence of a recession emerges.

However, Saut isn't sure if the current decline is over yet. He won't be completely comfortable until the S&P 500 breaks 1366 to the upside and holds it (it's currently around 1358).

And on the topic of cognitive dissonance Saut writes, "in order to reduce the anxiety of decision making, people perceive things in ways that may or may not be logical. Simply stated, people talk the way they bet. From a stock market perspective this means that the interpretation of economic and market news varies in direct relationship to the investor's bullish, bearish, or cautious market position."

Embedded below is Jeff Saut's latest commentary where you can read why he thinks this year is just like the past two:

Market strategist Jeff Saut is out with his weekly commentary entitled "Cognitive Dissonance." He titled his piece as such due to certain economic readings softening while others strengthened. Saut also addresses how it can often pay to go against the crowd, likening the current market action to that of the past two years.

He argues that just like the past two years, the markets have peaked in May/June and will decline for a few months before surging higher into year-end as no evidence of a recession emerges.

However, Saut isn't sure if the current decline is over yet. He won't be completely comfortable until the S&P 500 breaks 1366 to the upside and holds it (it's currently around 1358).

And on the topic of cognitive dissonance Saut writes, "in order to reduce the anxiety of decision making, people perceive things in ways that may or may not be logical. Simply stated, people talk the way they bet. From a stock market perspective this means that the interpretation of economic and market news varies in direct relationship to the investor's bullish, bearish, or cautious market position."

Embedded below is Jeff Saut's latest commentary where you can read why he thinks this year is just like the past two:

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